FTSE 100 Live 17 April: Sainsbury’s and Dunelm rally, index weakens after US reverse
FTSE 100 Live Thursday
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Market update: Sainsbury's leads weaker FTSE 100, Dunelm up 7%
Sainsbury’s eased the price war jitters of investors today as the grocer hailed “good trading momentum” alongside annual profits at the top-end of City hopes.
The shares led a downbeat FTSE 100, having struggled so far in 2025 after Asda launched its Rollback campaign and Tesco vowed to retaliate by sacrificing profits.
Sainsbury’s said it started its new financial year in a strong competitive position, boosted by a 7.2% rise in underlying operating profit to £1.04 billion for 2024/25.
The performance was marginally stronger than City forecasts, driven by double-digit growth at the grocery division and offset by lower profits at Argos.
Sainsbury’s expects to deliver a profits figure of around £1 billion in the current financial year as it responds to the increasingly competitive landscape.
It added: “We expect to continue to grow grocery volumes ahead of the market and we have started the year with good trading momentum across all our brands.”
The shares rose 3% or 7.2p to 255.2p, extending the past week’s recovery but still leaving the retailer down more than 8% this year. Tesco added 3.5p to 349.1p.
The FTSE 100 index reversed 51.87 points to 8223.73 after US markets closed sharply lower last night.
The S&P 500 index fell more than 2% after Federal Reserve chair Jerome Powell said the bank won’t rush its response to tariffs uncertainty.
He expects White House policies will fuel inflation and slow growth, creating a challenging scenario for rate setters.
The US outlook is a particular concern for Rentokil Initial investors, given that the pest control firm generates 60% of its revenues from North America.
Today’s first quarter update showed the region’s revenues edged 0.5% higher, with international operations the driving force behind the group’s 1.8% organic growth.
The shares rose 10.6p to 343.9p, still a fifth lower than their position in February.
Other stocks on the FTSE 100 risers board included Bunzl, which put back 44p to 2334p after sliding 26% following yesterday’s profit warning.
On the fallers board, AstraZeneca and GSK lost 142p to 10,112p and 26p to 1319.5p respectively. BAE Systems and London Stock Exchange also reversed 2% after their shares were marked ex-dividend.
In a weaker FTSE 250 index, the shares of Dunelm stood out after it reiterated full-year expectations in its third quarter update.
The homewares chain reported sales growth of 6.3% for the period alongside a 30 basis points improvement in its gross margin.
Shares jumped 7% or 63p to 1011p as Peel Hunt said Dunelm’s offer continued to “resonate strongly”. The broker reiterated a price target of 1375p.
Food delivery app Deliveroo also lifted 2.9p to 133p after reporting an acceleration in UK order growth to 7% in the first quarter of its financial year.
Founder and chief executive Will Shu said: “We continue to have confidence in delivering our guidance for 2025 whilst, like many others, remaining mindful of the uncertain macroeconomic environment.”
Deliveroo hails strong start to year
Deliveroo today said UK order growth reached 7% in the first three months of 2025, an acceleration from 5% in the final part of last year.
Gross transaction value - the total cost of people’s baskets plus delivery fees - lifted by 9% compared with the same period in 2024. Across the group, revenues rose by 7% to £518 million.
Founder and chief executive Will Shu described it as a “strong start” to the year.
He added: “We continue to have confidence in delivering our guidance for 2025 whilst, like many others, remaining mindful of the uncertain macroeconomic environment.”
The company’s FTSE 250-listed shares today rose 2.1p to 132.2p.
Sainsbury's shares rally as price war looms
A modest profit beat by supermarket chain Sainsbury’s today helped its shares to rise 3%, having fallen by 10% so far this year.
The 6.6p improvement of 254.6p also reflected sales momentum at the end of the financial year after grocery sales lifted 4.1% in the fourth quarter.
The company is guiding for the same level of underlying profit in the year to come as it joins Tesco in facing up to the threat of an aggressively price cutting Asda.
Richard Hunter, head of markets at Interactive Investor, said: “With the sector about to be embroiled in a trade war of its own, Sainsbury is preparing for the fight with some added momentum which should provide some protection.”
Hargreaves Lansdown analyst Aarin Chiekrie said forward guidance looks quite conservative at around 8% below market expectations.
He added: “That echoes conservative guidance from Tesco last week, and gives Sainsbury plenty of wiggle room to get its hands dirty if competition with the likes of Asda and Tesco heats up.
“But shy of an all-out price war, there could be room for positive surprises as the year progresses.”
FTSE 100 lower, Sainsbury's rallies after results
The FTSE 100 index has weakened 0.6% or 50.73 points to 8224.87, with AstraZeneca and GSK among the leading fallers.
BAE Systems and London Stock Exchange also reversed 2% after their shares were marked ex-dividend.
Sainsbury’s rose 4% or 9p to 257p after its full-year profits came in slightly ahead of City expectations.
Among other FTSE 350 companies reporting today, the shares of Rentokil Initial and Deliveroo were broadly unchanged following their updates.
Dunelm rose 5% or 49.5p to 997.5p after reiterating full-year expectations in its third quarter update. The homewares chain reported sales growth of 6.3% for the period.
US markets set to recover, gold above $3320 an ounce
US futures are showing a partial recovery after last night’s fall of 2.2% by the S&P 500 index.
Stocks came under pressure after Federal Reserve chair Jerome Powell said the bank won’t rush its response to tariffs uncertainty.
He expects White House policies will fuel inflation and slow growth, creating a challenging scenario for rate setters.
His comments on a data-dependent approach helped to support the US dollar after its recent slide to a three-year low against a basket of major currencies.
Meanwhile, the price of gold steadied at $3326 an ounce after surging yesterday by more than 3% in the biggest daily jump for two years.
ECB interest rates set for another cut
The European Central Bank is today set to make its third interest rate cut of this year and the sixth since June, bringing the deposit rate to 2.25%.
Traders will also be looking for indications over whether monetary policy could turn accommodative – below the neutral rate – in the next six to 12 months.
Uncertainty around US tariffs means Barclays Private Bank chief market strategist Julien Lafargue expects the bank to wait until it has updated forecasts in June.
He added: “Another area of focus will be the euro, given the recent appreciation of the single currency.
“While this may help from an inflation point of view, it represents downside risk to the growth outlook. As a result, it could push the ECB to err on the dovish side.”
Sainsbury's profits rise, steps up store openings
Supermarket giant today reported a 8.6% rise in underlying profits to £761 million, boosted by a strong end to its financial year.
Revenues for the year to 1 March rose 3.1% to £31.5 billion, with the final quarter of the period showing supermarket sales up 4.1% and Argos up 1.9%.
At a time of discounting by rivals Asda and Tesco, the group highlighted a strong competitive position at the start of the new financial year.
It added: “We expect to continue to grow grocery volumes ahead of the market and we have started the year with good trading momentum across all our brands.”
Retail underlying operating profit for 2024/25 rose 7.2% to £1.04 billion, with double-digit growth at Sainsbury's partially offset by lower profits at Argos.
It expects to deliver a figure of around £1 billion in the current financial year.
The group plans to open a total of 15 new supermarkets during 2025/26, while over the next two years it is making its biggest investment in new space for many years.
FTSE 100 seen lower after US sell-off, Nvidia down 7%
The FTSE 100 index is forecast to open about 0.4% lower after US markets last night closed deep in negative territory.
The Dow Jones Industrial Average fell 1.7%, the S&P 500 by 2.2% and the Nasdaq Composite reversed by 3.1%.
Nvidia shares lost 7% after it forecast a current quarter hit of $5.5 billion due to new US restrictions on exports of its H20 chips.
Despite the US sell-off, Asia markets are in positive territory after gains of more than 1% for the Nikkei 225 and Hang Seng index.
A late rally last night helped the FTSE 100 index to close 26.48 points or 0.32% higher at 8275.6. It is forecast to hand back those gains in today’s opening dealings.